At 7:11 AM 2/14/95, Roger A. McCain wrote:
>A few months ago there was a write-up in the New York Times (I think) about
>the contrasts between US and European unemployment. The theme was that
>whereas Europe has put its structurally unemployed low-skill on the dole,
>in the US we are supporting them in prisons, so that they don't show up on
>our unemployment roles; but that the contrast in _employment_ by
>demographic category is much less.
>
>I used that as a reading in a freshman seminar, but then I let it get away.
>Did anyone by chance see it and keep the reference? If so, please help by
>sending it to me.
I'm not sure this is an accurate picture. The US has pretty high labor
force participation rates and employment/pop ratios. Since we have about 1
million folks in prison, counting them as "unemployed" would add less than
one point to the unemployment rate, still leaving a gap of 3 to 5 points
between US and European jobless rates.
Even broader definitions of unemployment make the US look jobful. According
to the 1994 OECD Employment Outlook (table 1.4, p. 7), if you add
discouraged workers and involuntary part-timers to the OECD standardized
unemployment rate, the "alternative measures of labor market slack" for
1993 stack up as follows:
Australia 15.5%
Canada 14.6
Japan 5.4
New Zealand 10.4
Sweden 10.3
UK 12.3
US 9.4
What *is* different is that the European employed enjoy much higher levels
of security and rising real wage rates than the US employed. According to
the 1993 OECD Employment Outlook (table 3.3, pp. 88-89, and associated
text), flows into and out of unemployment in the US are about ten times
European levels. The table presents these average monthly flows into and
out of unemployment, expressed as a percent of the relevant source
population (i.e. the employed for unemployment, and the unemployed for
employement), for 1991:
inflow outflow
Canada 2.3 23.8
France 0.3 5.5
Germany 0.2 8.0 (1990)
Italy 0.2 3.6 (1990)
Japan 0.3 23.6
Sweden 0.4 30.0
UK 0.6 13.4 (1990)
US 2.1 37.3
In other words, the average US worker is much more likely to experience a
spell of unemployment in a year than a European or Japanese worker. Or, in
other other words, while 6.3% of the US unemployed in 1991 were unemployed
a year or longer, 51.1% of Spanish workers, 36.1% of British, 46.3% of
German, and 17.9% of Japanese workers were.
Doug
--
Doug Henwood
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